Union Government nods AADHAAR to be voluntary for opening Bank accounts and Mobile connections

After the SC imposed restrictions to use Aadhaar by private companies, the Government approved amendments to the Telegraph Act and the Prevention of Money Laundering Act along with AADHAAR

• The Union government approved amending two existing laws to provide legal backing for voluntarily sharing Aadhaar data for obtaining new mobile phone connections and opening bank accounts as an optional KYC after the Supreme Court barred mandatory use of 12-digit unique identifier by private firms.
•  The cabinet meeting chaired by Prime Minister Narendra Modi approved amendments to the Telegraph Act and the Prevention of Money Laundering Act (PMLA) after the Supreme Court (SC) in September imposed restrictions on the use of Aadhaar by private companies.
• The government’s move came after the Supreme Court struck down Section 57 of the Aadhaar Act, which allows private entities to demand the 12-digit unique identity number before providing services. Now, this will enable the Aadhaar holder to refuse to share details for opening a bank account or getting a Mobile SIM cards.
• As a result of the new direction passed by the apex court, Aadhar card is currently mandatory only for Liquified Petroleum Gas (LPG) but not required for availing benefits under MGNREGA, pension, Jan Dhan Yojana and Employees’ Provident Fund (EPF) schemes.
• The new law will ensure the protection of ADHAAR holder by turning UADAI into an independent authority that will have power to penalize the bodies that require Adhaar detail from the citizens without approval.

Supreme court Verdict in September – 2018

In September, the Supreme Court said Aadhaar was valid since it empowers the marginalized. But it restricted private entities from demanding access to sensitive information about the Aadhaar holder, including bank account details and biometric data like finger prints and iris scans. The court, however, ruled that Aadhaar will have to be linked to PAN (Permanent Account Numbers) needed for filing tax returns.

Union Government’s stance after SC’s verdict

• The central Government has agreed with SC’s verdict to constitutional validity of ADHAAR to use sensitive information of public by private companies. The government has also enhanced its understanding to use these public data by semi governmental organizations like PSU banks.
•  Under the amendments, the government has proposed an imprisonment of up to 10 years for attempting to hack Aadhaar data. Currently, the punishment for this offence is 3 years.
•  a child who has been enrolled for Aadhaar through his or her parents will have an option to opt out of Aadhaar database after attaining the age of 18 years.